SBEC Systems (India) Ltd Directors Report.

To,

The Shareholders,

SBEC Systems (India) Limited

Dear Members,

Your Directors take pleasure in presenting the 33rd Annual Report of the Company together with the Audited Accounts for the year ended 31st March 2022. FINANCIAL RESULT

The Companys financial performance (Standalone & Consolidated) for the financial year ended March 31, 2022 along-with that of the previous financial ended March 31,2021 is summarized below: (Rs. in Lacs)

PARTICULARS

Standalone

Consolidated

PERIOD ENDED 31.03.2022 PERIOD ENDED 31.03.2021 PERIOD ENDED 31.03.2022 PERIOD ENDED 31.03.2021
SALES & OTHER INCOME 296.83 22.83 296.83 22.83
TOTAL EXPENDITURE 142.90 26.45 142.90 26.45
OPERATING PROFIT/(LOSS) BEFORE TAX 153.93 (3.62) 153.93 (3.62)
PROFIT/(LOSS) AFTER TAX 129.92 (3.62) 129.92 (3.62)

During the year under review, the revenue from other income stood at Rs. 296.83 Lacs. The net profit of the Company stood at Rs. 129.92 Lacs as compared to net loss of Rs. 3.62 Lacs during the previous year.

DIVIDEND & RESERVES

In order to conserve the resources for future growth of the Company, the Board of Directors has not declared any dividend for the year under review.

The Company has not transferred any amount to the reserves for the year ended March 31,2022.

SHARE CAPITAL

The paid up equity capital as on March 31,2022 was Rs.1000 Lacs. During the year under review, the Company has not issued any class of shares nor granted stock options.

ASSOCIATE/SUBSIDIARY/JOINT VENTURE COMPANY

As on March 31,2022, the Company has one Associate Company i.e. SBEC Sugar Limited. Investment in the Associate is dealt with in accordance with Indian Accounting Standard (Ind-AS) 28, the consolidation of accounts of the Company with its associate are combined by using "Equity Method".

Further, a statement containing the salient features of the financial statements of the Associate company are prescribed in AOC-1 and appended as Annexure-A to the Boards Report.

There is no subsidiary company within the meaning of Section 2(87) of the Companies Act, 2013 ("Act").

MATERIAL CHANGES AND COMMITMENTS

There are no material changes which occurred in between the financial year ended on 31st March, 2022 and date of the report of the Company which affects the financial position of the Company.

DIRECTORS

In terms of Section 152 and other applicable provisions, if any, of the Companies Act, 2013 Mr. Shiv Shankar Agarwal, Director of the Company, retires by rotation at the ensuing Annual General Meeting and being eligible, has offered himself for re-appointment.

During the year under review the there was no change in the composition of Board of Directors.

Mr. Rohit Garg (DIN: 03296571), Non-Executive Non-Independent Director has resigned from the Directorship w.e.f July 26, 2022.

The Board has appointed Mr. Salil Seth (DIN: 09697511) as a Non-Executive Independent Director w.e.f August 16, 2022 and upto the date of forthcoming Annual General Meeting. The Board recommends his appointment for the consideration of the members of the Company at the Annual General Meeting. Brief Particulars of Directors seeking re-appointment/appointment have been given in the annexure to the notice convening the Annual General Meeting.

All the Directors have made necessary disclosures as required under various provisions of the Companies Act, 2013 and SEBI (LODR) Regulations, 2015. DIRECTORS RESPONSIBILITY STATEMENT:

Pursuant to the provisions contained in Section 134 (5) of the Companies Act, 2013, your Directors to the best of their knowledge and belief and according to information and explanations obtained from the management, confirm that:-

• so as to give a true and fair view of the state of affairs of the Company as at in the preparation of the annual accounts for the financial year ended March 31,2022, the applicable accounting standards have been followed and there are no material departures from the same;

• the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit and loss of the company for the financial year ended March 31,2022;

• the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

• The Directors have prepared the Annual Accounts on a going concern basis;

• The Directors have laid down proper internal financial controls to be followed by the Company and such controls are adequate and operating effectively and

• The Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively..

KEY MANAGERIAL PERSONNEL (KMP)

During the financial year ended 31.03.2022, following persons are Whole Time Key Managerial Personnel (KMP) of the Company in terms of provisions of Section 203 of the Companies Act, 2013.

S.No. Name Designation
1. Mr. Shiv Shanker Agarwal Chief Executive Officer
2. Mr. Luv Gupta Chief Financial Officer
3. Ms. Priyanka Negi Company Secretary

BOARD MEETING

The Board met four times during the financial year 2021-22, the details of which are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013.

COMMITTEES OF THE BOARD

Presently the Company has the following mandatory Committees:

> Audit Committee

> Nomination and Remuneration Committee

> Stakeholders Relationship Committee

The details of all the Committees along with their composition, terms of reference and meetings held during the year are provided in the "Report on Corporate Governance" forming part of this Annual Report.

POLICY ON DIRECTORS APPOINTMENT & REMUNERATION AND OTHER DETAILS

The Board on recommendation of the Nomination & Remuneration Committee has already framed a policy on Directors appointment and remuneration including criteria for determining qualifications, positive attributes, independence of a Director and other matters specified under said section. The policy is available on the website of the Company www.sbecsvstems.com.

BOARD EVALUATION:

As required under Section 134(3)(p) of the Companies Act, 2013 read with Regulation 17 of SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015, the Board of Directors had already approved the evaluation criteria for evaluating the performance of the Board of Directors, its Committees, namely, Audit Committee, Stakeholders Relationship Committee and Nomination and Remuneration Committee, the Directors individually and the performance of Independent Directors.

The manner in which the evaluation was carried out and the process adopted has been mentioned in the Corporate Governance Report.

STATEMENT ON DECLARATION GIVEN BY THE INDEPENDENT DIRECTORS

As required under Section 149 (7) of the Companies Act, 2013, all the Independent Directors have given declarations that they meet the criteria of independence as specified in Section 149 (6) of the Companies Act, 2013 and SEBI (LODR), Regulations, 2015.

STATUTORY AUDITORS

The Shareholders of the Company at the Annual General Meeting held on September 28, 2017 appointed M/s. Doogar & Associates, Chartered Accounts (Firm Regn No. 000561N) as the Auditors of the Company for a period of 5 years and term of the Auditors shall expire at the conclusion of the forthcoming Annual General Meeting of the Company.

Accordingly, upon recommendation by the Audit Committee, the Board of Directors, at its Meeting held on 08th August 2022 has recommended for approval of the Shareholders at the ensuing 33rd AGM of the Company, the appointment of M/s K.K. Jain & Co., Chartered Accountants (Firm Registration No.02465N), as the "Statutory Auditors" of the Company, for a term of 5 (Five) Years, to hold office from the conclusion of the 33rd AGM till the conclusion of the 38th AGM. The Auditors have confirmed their eligibility under Section 141 of the Companies Act, 2013 and the rules framed there under for appointment as Auditors of the Company.

STATUTORY AUDITORS REPORT

The Statutory Audit Report contains qualifications and the Company has given its comments on Audit Qualified Opinion for the Financial Year 2021-22, the details are mentioned below:

Response to Qualified Opinion in Standalone Financial Statement

Non reversal of diminution of current quoted investment, it is hereby clarified that the company is holding 1,42,30,884 Equity Shares of SBEC Sugar Limited and the Company is not intending to sell/ transfer/ otherwise dispose off these shares, the management has decided not to make any provision of diminution or reversal thereof.

The Statutory Auditors have not reported any incident of fraud to the Audit Committee of the Company during the year under review.

CONSOLIDATED FINANCIAL STATEMENTS

The Consolidated Financial Statements have been prepared by the Company in accordance with applicable provisions of the Companies Act, 2013, Accounting Standards and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The audited consolidated financial statements together with Auditors Report form part of the Annual Report. The Auditors Report does not contain any qualification, reservation or adverse remarks.

SECRETARIAL AUDITOR

Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s Soniya Gupta & Associates, Company Secretaries as the Secretarial Auditor to undertake the Secretarial Audit of the Company. The Report of the Secretarial Audit is given in Annexure-B to this Report.

The observations in secretarial audit report are self-explanatory and therefore do not call for any further explanation.

RISK MANAGEMENT POLICY

As required under Section 134(n) of the Companies Act, 2013, the Company has laid down the policy on risk management stating therein the objectives and purpose of the said policy.

The Risk Management Policy of the Company can be viewed on the Companys website www.sbecsvstems.com.

INTERNAL FINANACIAL CONTROLS

The Company has adequate Internal Financial Controls with proper checks to ensure that transactions are properly authorised, recorded and reported apart from safeguarding its assets. These systems are reviewed and improved on a regular basis. It has a comprehensive budgetary control system to monitor revenue and expenditure against approved budget on an ongoing basis. The internal auditors of the Company reviews the controls across the key processes and submits reports periodically to the Management and significant observations are also presented to the Audit Committee for review. Follow up mechanism is in place to monitor the implementation of the various recommendations.

CORPORATE SOCIAL RESPONSIBILITY (CSR) INITIATIVES.

Section 135 of the Companies Act, 2013 provides the threshold limit for applicability of the CSR to a Company i.e. (a) net worth of the Company to be Rs. 500 crore or more; or (b) turnover of the company to be Rs. 1,000 crore or more; or (c) net profit of the company to be Rs.5 crore or more. As the Company does not fall under any of the threshold limits given above, the provisions of Section 135 are not applicable to the Company.

DEPOSITS

During the financial year, Company has not accepted any deposit from public within the meaning of section 73 and 76 of the Companies Act, 2013 and Rules made thereunder.

CORPORATE GOVERNANCE

In terms of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 a detailed Corporate Governance Report along with a certificate from M/s Soniya Gupta & Associates, Company Secretaries in practice and Management Discussion and Analysis Report forms part of this Annual Report.

The declaration by the Chief Executive Officer and Chief Financial Officer addressed to the Members of the Company pursuant to Clause D of Schedule V Read with Regulation 34(3) and Chapter IV of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 regarding adherence to the Code of Conduct by the Members of the Board and by the Members of the Senior Management Personnel of the Company is also attached to the Corporate Governance report.

VIGIL MECHANISM & WHISTLE BLOWER POLICY

The Company has a vigil mechanism and a whistle blower policy. The same has been posted on the Companys website and the details of the same are given in the Corporate Governance Report.

RELATED PARTY TRANSACTIONS

In compliance with the Act and the SEBI Listing Regulations, the Company has formulated a Policy on Related Party Transactions (RPTs) and manner of dealing with RPTs. During the year under review, the Policy has been amended to incorporate the regulatory amendments in the SEBI Listing Regulations. The updated Policy can be accessed on the Companys website which is available on the Companys website at www.sbecsvstems.com.

All transactions with related parties during FY 2021-22 were reviewed and approved by the Audit Committee and were at Arms Length Price (ALP) and in the Ordinary Course of Business (OCB). Prior omnibus approval was obtained for all RPTs which were of repetitive nature and entered in the OCB and on an ALP basis. The transactions entered into pursuant to the omnibus approval so granted were reviewed by Audit Committee on quarterly basis.

Pursuant to the third proviso of Section 188(1) of the Act, the compliance with the provisions of Section 188(1) is not applicable, where all RPTs are carried out in the OCB and under ALP basis. Accordingly, the disclosure of RPTs as required under Section 134(3) (h) of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014 in form AOC-2 is not applicable to the Company for FY 2021- 22. However, the Company had material RPTs during FY 2021-22 under SEBI Listing Regulations. Hence, the same have been disclosed as form AOC-2 enclosed as Annexure C.

Details of RPTs entered into by the Company, in terms of Ind AS-24 are disclosed in notes to the financial statements forming part of this Integrated Report. There was no other material RPTs entered into by the Company with its Promoters, Directors, KMPs or other designated persons during FY 2021- 22, except those reported in the financial statements.

None of your Directors or KMPs had any pecuniary relationships or transactions with the Company during FY 2021-22.

Approval of Members is being sought for the material RPTs for FY 2022-23 at the ensuing AGM.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The information relating to conservation of energy, technology absorption and foreign exchange earnings and outgo pursuant to Section 134(3) (m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 is given in Annexure-D to this Report.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

During the financial year 2021-22, the Company has not made any investment nor given any loans or guarantees covered under the provisions of section 186 of the Companies Act, 2013.

PARTICULARS OF EMPLOYEES

The information required pursuant to Section 197 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 relating to the ratio of the Remuneration of each Director to the median employees remuneration shall not apply because none of the Directors has drawn any remuneration from the Company for the financial year 2021-22. In terms of the Provisions of Section 197(12) of the Companies act, 2013 read with Rule 5(2) & (3) of the Companies Appointment & Remuneration of Managerial Personnel) Rules, 2014. None of the employees of the Company were in receipt of remuneration of more than limit specified as set out in the above said Rules.

COST RECORDS AND AUDIT

During the period under review the provisions relating to maintaining of cost record and conduct Cost Audit are not applicable to the Company.

EXTRACT OF ANNUAL RETURN

Pursuant to Section 92(3) read with 134(3) of the Act, Annual Return (in e-form MGT-7) for the financial year ended March 31, 2022 is available on the Companys website at: www.sbecsvstems.com

SECRETARIAL STANDARD

The Company has complied with the Secretarial Standards issued by The Institute of Company Secretaries of India and approved by the Central Government as required under Section 118(10) of the Companies Act, 2013.

LISTING WITH STOCK EXCHANGES

The Equity Shares of the Company are listed with BSE Limited. The settlement of trade of equity shares changed from ‘P‘ group to ‘XT‘ group .W.e.f July 07, 2022

The annual fees for the Bombay Stock Exchange have been paid promptly for the year 2021-22.

SEXUAL HARASSMENT

The company has in place an Anti-Sexual Harassment Policy in line with the requirements of the Sexual Harassment of women at the workplace (Prevention, Prohibition and Redressal) Act, 2013. All employees (permanent, contractual, temporary, trainees) are covered under this policy.

The following is a summary of sexual harassment complaints received and disposed off during the year 2021-22:

No. of complaints received : NIL

No of complaints disposed off : NIL

PERSONNEL RELATIONS

Your directors hereby place on record their appreciation for the services rendered by the executives, staff and workers of the Company for their hard work, dedication and commitment. During the year under review, relations between the employees and the management continued to remain cordial.

APPRECIATION

Your directors thank the various Central and State Government Authorities and Agencies for the continued help and cooperation extended by them. The Directors gratefully acknowledge all stakeholders of the Company viz., customers, members, dealers, vendors and banks for their excellent support during the year. The Directors also place on record their sincere appreciation to all employees of the Company for their unstinted commitment and continued cooperation to the Company.

For & behalf of the Board of
SBEC Systems (India) Limited
Sd/-
Place: New Delhi Vijay Kumar Modi
Date: 08.08.2022 Chairman
DIN:00004606